Tag: welfare

Minnesota Fraud Whistleblower Claims She Was Subjected to ‘Smear Campaign’ After Reporting Concerns to State

The fallout continues in Minnesota over the explosive allegations of fraud from last month.

One whistleblower is now going on record, saying that she was subjected to a smear campaign after reporting her concerns to the state, saying she was even accused of being a racist.

The most troubling part of these reports for leaders in Minnesota is that they support the idea that they knew this fraud was happening and did nothing to stop it. People need to be prosecuted for this.

FOX News reports:

Minnesota DHS whistleblower details ‘smear campaign’ after reporting fraud concerns to state

A Minnesota Department of Human Services (DHS) whistleblower said she has been raising red flags about fraud in the state since 2019, but has faced only unyielding retaliation in response, calling Gov. Tim Walz’s assertion that he was unaware of the problem “absolutely false.”

Faye Bernstein, who has worked for Minnesota’s DHS for two decades in contract management and compliance, said she was subjected to a “smear campaign” for trying to make leadership aware of illegal contracting practices. She said she was called “racist” and that her work responsibilities were diminished.

“There is just a continuous effort to stifle you, to shut you up. And it is impossible to overcome,” Bernstein said on “Saturday in America.”

Federal prosecutors estimate that up to $9 billion was stolen through a network of fraudulent fronts posing as daycare centers, food programs and health clinics. The majority of those charged, so far, in the ongoing investigation are part of Minnesota’s Somali population.

Rather than receiving thanks for speaking out about irregularities within the contracting process, Bernstein wrote in a letter obtained exclusively by “Saturday in America” that the “nearly unbearable retaliation” she faced also included being “trespassed from all DHS-owned or leased property” and investigated “at a great cost to the state.”

To make matters worse, the fraud allegations just keep coming.

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Two men charged in $120M adult day care fraud scheme in Queens 

The Justice Department accused two men of stealing $120 million from federal health care programs over the course of a decade by bribing patients to enroll in social adult day cares and submit unneeded prescriptions to a pharmacy.

Inwoo Kim, 42, and Daniel Lee, 56, were charged with conspiracy to commit health care fraud. They each face up to 10 years in prison. 

“Today’s complaint targets those who prey upon the vulnerable so they can steal from American taxpayers and defraud government programs meant to help the public,” A. Tysen Duva, who leads the Justice Department’s criminal division, said in a Monday statement. 

Kim owns Happy Life and Royal, two social adult day cares in the Flushing neighborhood of Queens in New York City. Lee worked as the centers’ program director. 

Charging documents allege the duo began working to submit fraudulent Medicaid and Medicare claims as far back as March 2016. They also purportedly induced patients to submit unneeded prescriptions to a pharmacy Kim used to own.

Patients allegedly received financial incentives, including grocery gift certificates and cash. 

“Please give $10,000 to the Korean members first,” Kim wrote in a 2023 text message, according to the complaint.

Over the course of a decade, Medicaid purportedly paid Kim’s businesses $62 million for their social day care services while Medicare paid the pharmacy $58 million for prescription drugs. 

Kim’s attorney declined to comment. The Hill has reached out to Lee’s attorney for comment.

Kim has faced scrutiny for years. The Department of Health and Human Services has been investigating him since 2021, and the charging documents also indicate an unnamed health plan had received complaints about the kickbacks. 

And in February 2024, New York’s Office of State Comptroller (OSC) identified concerns during a site visit. Day care staff had provided “suspicious” sign-in sheets that appeared to include pre-filled dates and the same handwriting for numerous names, according to the charging documents. 

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Here’s Where Prosecutors Should Look For More Evidence Of Somali Daycare Fraud

Alot has been made of the Nick Shirley videos claiming to “prove” that dozens of companies owned and allegedly operated by Somalis as daycare centers were involved in defrauding the federal government out of hundreds of millions of U.S. taxpayer dollars. And although these videos show numerous daycare facilities with boarded-up windows, broken doors, untreated snow-covered sidewalks and parking lots, no operating phone numbers, no playground equipment, and most importantly zero children at them during regular working hours, this circumstantial evidence only lays the groundwork for identifying hundreds of potential fraudsters. 

The corporate media, Minnesota Gov. Tim Walz, and other leaders on the American left have dismissed Shirley’s videos as unsubstantiated propaganda and/or “racist,” but in fact prosecuting those involved with these sham daycare centers should be relatively easy, using an assortment of readily available financial records.

Bank Records

It is undisputed that Somali daycare centers received millions of federal dollars either directly or through various state-sponsored programs funded by federal grants. And since either Minnesota or the federal government made ACH or other electronic payments directly to these businesses, they already know which business bank accounts to pursue. 

By now, the Department of Justice should have issued federal criminal subpoenas for records related to all these accounts. And since banks are typically required to respond to criminal subpoenas within 1 to 2 weeks, the feds already should have lists of which business entities were paid, their business type (C-Corp, S-Corp, LLC, general partnership, etc.), their employer identification number, and lists of authorized account signers. With this data and the accompanying monthly bank statements, tracing disbursements from these business accounts will be the next phase of any investigation.

Of course, if large transfers were made to other bank accounts, the DOJ should repeat the subpoena process until all disbursements are found. If these efforts uncover large cash withdrawals from these accounts, this would indicate large-scale fraud, since legitimate businesses operating in present-day America pay almost all operating expenses electronically or by bank ACH — never by cash. If these centers used paper checks, information regarding who was paid and how much would be readily discernable from copies of cancelled checks.

Employer Tax Filings: Forms W-2, 941, and 1099

In order to have billed the government millions for childcare, all these daycare facilities had to have employees or contractors, because Minnesota mandates strict adult supervisor/child ratios. 

Under these rules, the maximum ratio for infants per adult is 4:1, for toddlers it’s 7:1, and for preschoolers it’s 10:1. Consequently, a center would need 77 full-time attendees, active for 12 consecutive months, to achieve a $1 million annual bill rate, based on the average daycare cost ($1,094 per month) per a 2024 study by Child Care Aware of America. And under Minnesota staffing regulations, the center would need eight to eleven full-time adult employees to achieve $1 million of annual revenue. 

We can do similar calculations for if the center caters exclusively to infants, which are billed at a higher rate.   

We can also pull employer tax filings for the duration these businesses were receiving funds from the government. Under federal employment law, any business with a W-2 employee must file Form 941 quarterly. This tax form lists all employee names, their Social Security numbers, the total Social Security and Medicare wages paid to each employee, the total number of employees paid, and the amount(s) of federal income and FICA taxes withheld during each reporting period. And if these centers failed to file Form 941, hefty IRS fines would be due. 

But, if these centers willfully failed to file these employer forms, the failure to file becomes a criminal misdemeanor, punishable by a fine of up to $25,000 ($100,000 for a corporation) and up to one year in jail per violation. And if the business entity failed to file these forms to conceal a larger fraud, noncompliance becomes a felony tax evasion case. In such cases, penalties escalate to a $100,000 fine ($500,000 for a corporation) and five years in prison per count.

In addition to the employer filings, each employee must receive a W-2 form annually. Moreover, the willful failure to provide said form to an employee could result in an additional fine of up to $630 per occurrence, without a cap. And if these daycare centers used contract labor, they would be required to file Form 1099 annually for each contractor who received more than $600. Again, if these centers operated using contract labor and willfully failed to issue W-9s, they would also be fined up to $630 per missing form, without limit. All of this data should be subpoenaed as well.

If these daycare centers were legitimate, they must have employees. And we would now have two data sources to prove if employees existed. First, payroll data showing payments either directly to employees or through a payroll processing agency, both easily identifiable from disbursements on the monthly bank statements. Second, the federal tax filings showing who was paid what and what FICA taxes were withheld. 

If there were no employees, fraud occurred. If there were employees, did the proper federal tax filings occur? If not, even a mediocre federal prosecutor fresh out of law school should have little problem achieving a tax fraud conviction.

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Tren de Aragua Brutally Tortures and Kills Innocent People While Benefiting From Federal Funds

When reports of the brutal Venezuelan gang Tren de Aragua first appeared, Democrats denied its existence, claiming it was an anti-immigrant myth perpetrated by Republicans. That denial began to unravel after the Aurora, Colorado incident in August and September 2024, when video surfaced showing armed men inside an apartment complex.

Governor Jared Polis’s office initially dismissed claims of an “invasion,” with a spokesperson saying the narrative was a “feature of local officials’ imagination” and suggesting the allegations were being used for political theater.

Several mainstream media echoed that dismissal, describing Tren de Aragua as a new “bogeyman” or even a hallucination. While acknowledging the gang’s existence, they argued that reports of organized violence amounted to a fabricated “invading army” narrative designed to fuel anti-immigrant sentiment and justify mass deportations.

In reality, the gang is very real and has been brutally torturing and killing people while also taking advantage of federal and state benefits programs. ICE has been arresting its members and leaders, but those cases receive little attention from the mainstream media because they do not fit the narrative.

Last January, a 58-year-old woman in Burien, Washington, just south of Seattle, was kidnapped from her apartment complex by two illegal aliens, Alexander Arnaez-Gutierrez and Kevin Sanabria-Ojeda, who have confirmed ties to the Tren de Aragua gang. The attackers tortured the victim by using a power drill on her hand to force her to reveal her ATM PIN and the location of her jewelry. They also beat her and eventually shot her before leaving her for dead. The woman survived by playing dead until help arrived.

On January 8, 2026, ICE arrested an illegal alien, Venezuelan national, and confirmed Tren de Aragua gang member, Yorvis Michel Carrascal Campo, in Colorado Springs on charges including murder, racketeering, and drug trafficking tied to crimes in New Mexico. According to a federal indictment, Carrascal Campo participated in the June 2024 kidnapping and killing of a man and helped conceal evidence of the crime. The victim’s body was later hidden in a remote area of New Mexico.

Under President Trump, federal investigations into Tren de Aragua have focused on how the gang exploits migrant infrastructure by embedding itself within legitimate support systems run by nonprofits and funded by the federal government. While these programs are intended to provide humanitarian aid, investigators say Tren de Aragua has used them as hubs for recruitment, logistics, and criminal activity.

Federal agencies and congressional committees have focused on multiple locations where Tren de Aragua established footholds, most prominently New York City’s Roosevelt Hotel. FEMA and DHS opened investigations into claims that Tren de Aragua–linked groups, including Diablos de la 42, were operating out of city-run shelters.

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Democrats Hate Anyone Who Doesn’t Love Crime And Fraud As Much As They Do — Even Leftists

Democrats hate certain other Democrats and leftists about as much as they hate you, and their targets are quite revealing.

In Los Angeles, elected City Controller Kenneth Mejia has unearthed significant social services fraud and waste and is pushing to fund more investigators — without success — so he can dig deeper. Mejia is way left, a high-octane Bernie bro who ostensibly “left” the Democrat Party in 2024. He has at times identified with the Green Party, apparently because the Democrats were much too far to the right for him. But Mejia is also a certified public accountant and a true believer in leftist social intervention, and he takes it personally when people steal from government programs that are supposed to help the poor. Mejia’s investigators are the reason a homeless services contractor in Los Angeles is awaiting trial on a massive list of state and federal felony charges for fraud.

Mejia revealed earlier this week that real estate and private equity “executives” as well as multiple “billionaires” are “pouring money” into the 2026 controller’s race to “oust” him amid his reelection bid.

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61 Percent of Illegal Immigrant Headed Households Were on Welfare in 2024: Center for Immigration Studies

Over 60 percent of illegal immigrant-led households and 51 percent of legal immigrant households received some sort of welfare benefits in 2024, compared with just 37 percent of natural-born citizen households taking taxpayer benefits, according to a new report from the Center for Immigration Studies.

The study, released on Wednesday, paints a concerning picture of welfare use by both illegal immigrants and natural-born U.S. citizens.

“If we wish to avoid high use of welfare by the foreign-born in the future, then moving to a system that selects immigrants based on their education or skills makes it much more likely they will earn higher incomes and not need welfare. Since more than one-fifth of all immigrant households using at least one welfare program are headed by an illegal immigrant, enforcing immigration laws and reducing the size of the illegal immigrant population would also be helpful in lowering future immigrant welfare use,” said the Center for Immigration Studies.

Researchers found that 61 percent of households headed by illegal immigrants, 51 percent of those headed by legal immigrants—whether naturalized citizens or visa holders—and 37 percent of natural-born citizen households received some sort of welfare.

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Not Just the Somalis: Nigerian Honored by Gretchen Whitmer Exposed as Massive Day Care Fraudster – Stole While Trashing America’s ‘Structural Racism’

Michigan might have its own fraud scandal brewing.

After widespread fraud was uncovered in Minnesota’s day care and other government-funded social service programs, most of them run by people linked to the immigrant Somali community, the public’s crosshairs turned to state officials, particularly Democratic Gov. Tim Walz. Surely these people were not stealing billions from hardworking Americans without having help from public officials?

Similar questions may soon be asked in Michigan of its own programs and its Democratic governor, Gretchen Whitmer.

A former professor, Nigerian immigrant Nkechy Ezeh, pleaded guilty last month to wire fraud and tax evasion in a scheme that defrauded Michigan taxpayers out of over $1 million, according to news site MLive.

The misappropriated money had been intended for Early Learning Neighborhood Collaborative, an early childhood education program for disadvantaged children. Ezeh was the founder and CEO of ELNC.

“The nonprofit closed in 2023 after Ezeh and former Director of Finance and Administration Sharon Killebrew were accused of embezzling more than $2.5 million combined over several years,” WZZM-TV reported.

Killebrew, 70, was sentenced to four years and six months in prison after pleading guilty to tax evasion and conspiracy to defraud a federally funded program, according to MLive.

Ezeh faces 20 years for wire fraud. The charge of tax evasion could carry an additional five years in prison.

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Fraud as Policy: The Incentives of the Modern Welfare State

The scale of fraud uncovered in recent years has exposed how government transfer programs function, even as meaningful public or legislative reckoning remains largely absent. What began as a series of pandemic-related scandals has revealed something broader and more troubling: large-scale fraud is not an anomaly within the modern welfare state. The federal government, taxpayers, lose between $233 billion and $521 billion annually to fraud, based on data from 2018 to 2022.

It is a predictable outcome of systems that distribute vast sums of money without market discipline, rely on third-party payment structures, and diffuse responsibility across layers of bureaucracy. As Murray Rothbard argued, welfare gains can only be demonstrated through voluntary exchange, while state transfer programs necessarily rely on coercion and therefore cannot be said, in economic terms, to increase social welfare, only to redistribute resources while masking loss.

Minnesota provides one of the clearest illustrations of this dynamic, especially since a private reporter revealed massive fraud in the state at the end of last year. In the Feeding Our Future scandal, federal prosecutors alleged that more than $250 million intended for child nutrition was siphoned through non-profit organizations that billed the government for meals that were never served. A federal judge has since ordered the forfeiture of more than $52 million connected to the scheme, underscoring both the scale of the losses and the failure of oversight mechanisms designed to prevent them. The case involved federal funds administered by state agencies and distributed through private entities, with little meaningful verification before reimbursement.

This was not an isolated incident. Prosecutors in Minnesota have charged defendants in a wide range of fraud schemes involving pandemic unemployment benefits, economic injury disaster loans, autism-related health services, transportation programs, and other federally funded initiatives. These cases mirror prosecutions across the country. In Texas, defendants have been sentenced for multi-million-dollar disaster relief fraud. In Massachusetts, companies have paid millions to resolve allegations of PPP loan fraud and emergency rental assistance schemes. Similar cases appear regularly in Department of Justice press releases, spanning Medicare covid testing fraud, SNAP abuse, PPP and EIDL loan abuse, unemployment insurance fraud, and false claims against federal health care benefit programs.

Nationally, the numbers are staggering. Government watchdogs have estimated that fraud in pandemic unemployment programs alone may exceed $100 billion. Well over 200 billion was lost to fraudulent PPP and EIDL claims. Medicare billing schemes tied to covid testing generated billions in false claims. These figures do not represent marginal losses. They reflect a system operating at a scale where fraud becomes organized, repeatable, and profitable.

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Eyes on California: 18% of Total US Home Health Care Billing Is Coming Out of LA County – One Doctor Billed Govt. for $120 Million IN ONE YEAR!

The Trump Administration and Dr. Mehmut Oz, the Administrator of the Centers for Medicare and Medicaid Services, have turned their attention to Los Angeles County and the massive amount of alleged medical fraud that is being reported from California.

According to FOX News, one LA doctor billed the government $120 million, claiming to oversee 1900 patients… in one year!

18% of THE ENTIRE COUNTRY’S home health care billing is coming out of Los Angeles County! Almost 20%!

And, Los Angeles has almost 2,000 registered hospice agencies! That is more than 36 states combined and thirty-times more than the whole state of Florida and New York.

Dr. Oz explained how easy it would be to open a hospice in LA, you don’t even have to live there!

Dr. Oz: “How is that possible? And take a look at this map, a cluster of 287 hospice providers, in a two-mile radius, some in strip malls, unmarked buildings, even a wrecking yard and vacant lot. All of it is just paperwork. I could fill that out in Kazakhstan if I want and get a hospice license waiting for me.”

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$50 Billion and 30K Dead People: HUD’s Turner Exposes Waste, Fraud and Abuse

HUD Secretary Scott Turner announced new policy changes aimed at restricting federal housing benefits to U.S. citizens, tightening oversight of taxpayer-funded programs, and addressing what he described as large-scale waste and payment errors within the Department of Housing and Urban Development.

Turner said HUD has moved to block non-permanent residents from accessing FHA-insured mortgages, while also launching audits of public housing authorities to ensure federal housing dollars are not being used to support illegal aliens.

HUD Secretary Scott Turner announced new policy changes aimed at restricting federal housing benefits to U.S. citizens, tightening oversight of taxpayer-funded programs, and addressing what he described as large-scale waste and payment errors within the Department of Housing and Urban Development.

Turner said HUD has moved to block non-permanent residents from accessing FHA-insured mortgages, while also launching audits of public housing authorities to ensure federal housing dollars are not being used to support illegal aliens.

“We eliminated non permanent residents eligibility for FHA insured mortgages, and we are auditing public housing authorities to ensure taxpayer dollars don’t support illegal aliens,” Turner said.

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